China orders Bitcoin miners to close their operations
If last month we commented that the cryptocurrency market was sinking with declines that reached 30% and 40% in Bitcoin and Ethereum after the People's Bank of China announced the ban on payments with Bitcoin in its country, thus closing the doors to millions of users in their country which caused a massive sale of these products throughout the world, in recent sessions, a new blow from the Asian giant has led to nearly $300 billion disappearing within the digital currency market.
On this occasion, in a new attempt to control the cryptocurrency market in this country, the government of Beijing has ordered bitcoin miners to close all their operations, while the People's Bank of China declared that investors in this sector favour money laundering and other illegal or criminal activities and therefore represent a serious damage to the security of the Chinese people.
In addition to the cryptocurrency market, one of the big losers from such restrictions include companies like Coinbase, which is currently trading at $222.60 per share compared to the $328 it began with on April 14, during an unprecedented upward spiral in which Bitcoin exceeded $64,000.
If we look at the daily chart of Bitcoin, we can see how, after marking historical highs, it has experienced a strong correction. This complies with the bearish divergence that we observed in its MACD indicator, which has led it to lose around 50% of its value before currently trading in an important side range represented by the green and red stripes between the levels of $30,000 and $40,000 per Bitcoin.
During this important decline, the price has broken several important support, causing a triple cross of bearish averages which may imply a further correction in the price if the price is finally able to break down the lower band of the sideways movement and the level of $30,000.
As long as the price fails to recover in a sustained manner, the important level of coincident resistance of its average of 200 sessions and the Fibonacci retracement level at 38.2% in the $40,000 the sentiment will remain bearish, although for a greater upward momentum it is necessary that the price manages to overcome upwards the important level of support and resistance, represented in orange.
Source: Admiral Markets MetaTrader 5. Btcusd daily chart. Data range: July 23, 2020 to June 22, 2021. Prepared on June 22, 2021 at 11:45 a.m. CEST. Please note that past returns do not guarantee future returns.
Evolution in the last 5 years:
- 2020: 302.3%
- 2019: 94%
- 2018: -73.2%
- 2017: 1337.7%
- 2016: 124.1%
With the Admirals Trade.MT5 account, you can trade BTCUSD Contracts for Differences (CFDs) and more than 3000 stocks! CFDs allow traders to try to profit from the bull and bear markets, as well as the use of leverage. Click on the following banner to open an account today:
INFORMATION ABOUT ANALYTICAL MATERIALS:
The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter “Analysis”) published on the websites of Admiral Markets investment firms operating under the Admiral Markets trademark (hereinafter “Admiral Markets”) Before making any investment decisions please pay close attention to the following:
- This is a marketing communication. The content is published for informative purposes only and is in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.
- Any investment decision is made by each client alone whereas Admiral Markets shall not be responsible for any loss or damage arising from any such decision, whether or not based on the content.
- With view to protecting the interests of our clients and the objectivity of the Analysis, Admiral Markets has established relevant internal procedures for prevention and management of conflicts of interest.
- The Analysis is prepared by an independent analyst, Roberto Rojas (analyst), (hereinafter “Author”) based on their personal estimations.
- Whilst every reasonable effort is taken to ensure that all sources of the content are reliable and that all information is presented, as much as possible, in an understandable, timely, precise and complete manner, Admiral Markets does not guarantee the accuracy or completeness of any information contained within the Analysis.
- Any kind of past or modeled performance of financial instruments indicated within the content should not be construed as an express or implied promise, guarantee or implication by Admiral Markets for any future performance. The value of the financial instrument may both increase and decrease and the preservation of the asset value is not guaranteed.
- Leveraged products (including contracts for difference) are speculative in nature and may result in losses or profit. Before you start trading, please ensure that you fully understand the risks involved.